Online retail is still a small slice of the retail pie, although after the craziness of 2020, it’s a much bigger slice. NAB is reporting 59.3 per cent year-on-year growth (October to October) for online retail. Around 1 million households made their first online purchase ever between April and September last year. For online retailers, our challenge now is to keep those customers. Amazing customer experience is the way to do that. Let’s look at the history of online retail. In the earl
e early days, there was one value proposition: price. That was pretty much the only reason to buy online.
Over time, and to a large extent today, the primary value proposition of online became convenience. Range of products, fast delivery – and the ever-important reason – being able to shop in your PJs. Price is always a factor, but most retailers aren’t leading with a price message any more.
Convenience got us to this point, but it won’t take online retail to the next level. To do that, we need to exploit the uniqueness of online, while overcoming the Achille’s heel of e-commerce: touch and feel, and immediacy.
I would have said service is another weakness, but have you tried getting meaningful service in a bricks-and-mortar shop recently? There’s a lot more misses than hits. Physical retail used to own service, but their hold on this is questionable.
Given that competing on immediacy and touch is hard (although sub one-hour drone deliveries may start to change this in time), we need to look at the natural advantages of online. Live chat customer support can scale much more easily than you can in 100 shops. The ability to use new technologies – AR, wizards, and more – is very hard to do in-store. In these areas, online is the leader. Also, did I mention buying in pajamas?
The way to keep these new customers online is to give them a better experience than can be had in store. By exploiting the things that are unique to online, we can create something that makes an amazing experience.
Look at a fast growing success story like Miss Amara. In the historically somewhat sleazy rug industry, they’ve actually made the experience better than in-store. They have experienced stylists who will help with interior design matters, rapid response live chat to help you out, augmented reality tools which show the rug in your space, a Preezie-powered rug selection wizard to help those less confident in their interior design skills, and a try it at home service with free returns. This is combined with beautiful designs and inspirational content. They haven’t just competed with the in-store experience, they’ve smashed it out the park. I can’t see how a bricks-and-mortar rug reseller would hope to compete with that.
We need to look at companies like this who are taking the online customer experience to the next level. This is the year of customer experience. Innovate or be left behind.
